- In a notice of additional authority published on Thursday, Ripple, which has been engaged in a protracted legal battle with the SEC for the past few years, declared that the financial penalties the agency had suggested were irrational.
- Ripple likened the proposed penalty levied by the SEC against it to those imposed on Terraform Labs.
In an attempt to settle the company’s lawsuit with the US Securities and Exchange Commission for a lesser fine, Ripple Labs’ attorneys are attempting to take advantage of recent fines levied against Terraform.
In a notice of additional authority published on Thursday, Ripple, which has been engaged in a protracted legal battle with the SEC for the past few years, declared that the financial penalties the agency had suggested were irrational.
The business likened penalties imposed on Terraform Labs to the SEC’s planned $2 billion sanction for selling XRP to institutional investors. According to Ripple, the fine ought to be more like $10 million.
On Wednesday, Terraform consented to pay $4.47 billion in fines; a judge approved the settlement on Thursday.
According to Ripple’s attorneys, the SEC’s proposed civil penalty in Terraform serves as evidence of its irrationality in this particular case.
According to Ripple’s argument, the SEC has consented to civil fines ranging from 0.6% to 1.8% of the defendant’s gross profits in cases that are similar—and in some circumstances, even more serious. Terraform is consistent with that trend.
Additionally, Ripple referenced a jury’s April verdict finding that Do Kwon, a cofounder of Terraform Labs, and the company committed civil fraud.
In this instance, however, the attorneys stated that despite the lack of any fraud accusations and the fact that Institutional Buyers did not sustain big losses, the SEC is requesting a civil penalty that is significantly higher than that range.
Terraform thus affirms that a reasonable civil penalty would be no more than $10 million and that the Court should reject the SEC’s irrational and unusual proposal.
When contacted for comment, the SEC did not reply right away.
Since the SEC accused Ripple of raising $1.3 billion through the sale of XRP, which it claims is an unregistered security, the two parties have been at odds in court for years.
Because a blind bid procedure was in place for some of Ripple’s XRP trades, known as programmatic sales, Judge Analisa Torres of New York concluded last year that the sales did not violate securities laws. Nonetheless, she declared that additional token sales made directly to institutional investors qualified as securities.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
